According to our latest Beyond Recruitment Economic & Labour Report Plus Salary Guide 2020, NZ businesses continue to be “cautiously optimistic” about their future. Economic pressure overseas and the local legislative landscape has not been inspiring business confidence. Finding, attracting and retaining talent is a big concern among many New Zealand employers, and the issue must be faced. It’s no longer a choice, it’s a necessity. Here are some of my thoughts on what Kiwi employers can be doing.
What is on the horizon?
Economic analyst Shamubeel Eaqub, who provided commentary for our 2020 Beyond Recruitment Economic & Labour Report, predicts the NZ economy is in a slow grind and may be heading for a downturn.
One important thing to note as an employer is that during an economic slowdown, whilst the talent pool may get larger, this does not mean that the quality will improve. The best candidates will typically try to hold on to their jobs for longer. Consequently, the 49% of employers who cited ‘lack of available talent’ as a key hiring difficulty will still struggle to see the quality they expect in the available or freeing talent.
There was a relatively even split of employers who were concerned about attraction and retention in the coming year, with 26% of respondents citing attraction as their organisation’s primary concern, 30% pointing to retention and 41% giving them equal weight.
Respondents also indicated there are barriers that prevent them from adequately addressing satisfaction/engagement issues, with 32% citing monetary resources as the key challenge. Other major barriers include a lack of time (33%) and the difficulty of changing employee mindsets (32%). This does seem like a concerning forecast for those already experiencing staffing difficulties.
What can businesses do?
As an employer, if you’re worried about future hiring difficulties, we have the following advice:
Make sure you retain your employees
Good people are hard to come by at the best of times, therefore it’s imperative that you hold onto those you already have. There are many different ways to improve the satisfaction and engagement of employees. Our survey evidenced that 47% of employers who have such programmes in place have cited positive benefits.
The key to retention is not just about the dollars. Our results suggest most organisations provide at least one or two additional benefits, such as flexible working hours, special leave days, health insurance, etc. Indeed, the top employee satisfaction/engagement solutions our respondents cited are:
- Flexible working arrangements (68%)
- Employee assistance programmes (64%)
- Health and wellness initiatives (59%)
Companies offering these solutions are showing employees that they care about their careers, their wellbeing and their diverse priorities. By offering your employees these types of benefits and a caring approach, if or when an economic downturn does arrive, you will see your business recognised as a safe haven in tough times.
And what if trouble does strike?
Shamubeel Eaqub made a great point in his commentary. He noted that during the previous recession, many firms facing financial troubles chose to offer their employees reduced hours rather than letting them go. While it’s never positive to have to change somebody’s hours due to financial woes, these firms showed their employees that they were valuable enough to cling on to despite the trouble. This was an excellent loyalty booster for those employees.
Your circumstances may, of course, differ, however before making the decision to let staff go, consider if you could instead offer alternatives – reduced hours, remote working, etc. Anything that might cut business costs without having to let go of great people.
Are contractors and AI systems alternatives?
We asked respondents whether switching to contractors, remote/overseas workers or AI systems was a solution to some of the hiring difficulties cited in this article. The majority of business owners were hesitant to choose these over permanent, in-office workers.
But should businesses be turning to them?
That’s a trickier question.
Your permanent employees will probably always be some of your best, most productive people. They help build your culture, and in turn, your culture can help attract more great talent. But AI and contractors are excellent gap-fillers and growth-makers. They can handle tasks that you wouldn’t otherwise be able to or take over processes that are hindering your in-office workers.
Our advice to any business would be to at least build a basic understanding of AI and how it can be used to improve your organisation, and to build a talent pool of flexible workers who can be called upon quickly to help out.
While you might not use either of these over permanent people, if you continue to struggle to find and attract said in-office workers, then you can call upon your extended network to fuel business stability and, hopefully, growth. Or, you could find a way to make the two work in tandem rather than opt for one over the other. For instance, AI can be used to aid rather than replace productivity – in fact, 54% of executives say their AI has already done so1.
It’s hard to predict what the coming years will do to NZ’s business landscape, especially given that the international economy is in so much tumult. However, with the right level of preparedness, Kiwi companies can weather the economic storm and come out the other side ready for growth and prosperity.
If you’d like to learn more about the New Zealand economy and labour market, read our report by clicking here.